Bye Bye, Boeings (Classics, that is)

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Coming after United’s 737 retirements, Continental’s move to park its 737 Classics marks the end of the old-generation Boeing 737 as a significant player in the United States. The last big player is US Airways, and their fleet, mostly used in Northeast-to-Florida service, has been living or flying on borrowed time. People often get dewy-eyed when an aircraft leaves the fleet, but having flown those United -500s and indeed those truly decrepit US Airways -400s, with their broken seatbacks and sad, tired interiors, we are glad to see them go. (The above repainted 737-400 is seen in better days!) They are not only too old, too slow, and too small to make money, but in today’s fuel-price environment, they’re just too thirsty. And airlines have been reluctant to upgrade their interiors since they’re going to go and be beer cans some day soon. For some thoughts on who and what might replace them, our friend and colleague Flightblogger has some thoughts. 

Before any one hastily points out that Alaska Airlines has a fleet of -400s, let me point out that they’re scheduled for replacement; even though US Airways has new Airbuses on order, it will be a while, a good long while, before it bumps its old Classics.

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6 Responses to Bye Bye, Boeings (Classics, that is)

  1. Chuck June 8, 2008 at 8:02 pm #

    I think there will still be some 737-500 classics in Continental’s fleet after the reductions are complete, although their days may be numbered as well.

    The 737-900ER is a good replacement for the 757-200 on domestic routes, but I don’t think it has the range to do much international stuff, other than the Carribean, possibly.

  2. JG June 11, 2008 at 1:09 am #

    Although some of the -300 airframes are coming up on 24 years old, which makes them difficult to import into a number of countries, the economics of the -300/-400/-500 are not radically different from the -600/-700/-800. The new wing gives about 10-15% less trip burn, depending on stage length over 600 SM/90 mins at flight levels higher than 33,000. The higher bound is only achieved when you get up to 39-41,000 feet which is only justified on a flight of 120 mins or longer, and depending on MGTOW/WATs limits you may not get there.

    Everybody forgets that the difference in fuel burn per available seat between a -200 and -300 was accomplished by taking the max capacity from 128 out to 149. The trip fuel burn on a -200 and a -300 up to 120-180 mins is not very different. The -400 can go to 189 seats in high density config, and, consequently, is quite fuel efficient. The -500, when flown on a 250-500 SM segment into a hub has never had significantly better trip economics than a -200.

    In the price difference between a new -600/-700/-800/-900, and a used Classic, there is plenty of room to trade off the slightly higher fuel burn and the mature maintenance costs. Retrofitting a new generation interior at a D check intercept is no more than $10,000 per seat.

    What is really happening when you read that CO and UA are retiring 737s is that they have made a strategic decision to abandon short haul flying into the hubs (except where total traffic volume warrants 200+ seats) and they will contract that flying to code-sharing regional partners flying CRJ-200/700/900 and EMB-145/170/190, where the combination of labor costs, and lower fuel burn offer slightly better hub feed economics than continuing to run 737 Classics for their own account.

    By extension, this also applies to A-319/320 series airplanes because the fuel burn per trip/seat is not radically better than what is achieved with a 737 Classic series.

    The real issue affecting US majors is not the rising cost of fuel (because % wise it is not orders of magnitude different from what happened between June 1973 and June 1976), but a complete inability to price tickets outside of the perishable “strawberry theory” that underlies inventory management practice. Since very few of the senior managers at any of the carriers understand the complete picture of the airline business, they entrust pricing decisions to relatively junior personnel (who have never even run a lemonade stand, and would blindly start discounting lemonade towards 1500 because sales had been slow, ignorant of the fact that the hottest peak of the day was about to arrive).

    Until that problem is solved, no amount of parking 737 Classics or ones that flew in from SEA last week is going to restore profitability to the airline industry.

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